Hepadnaviruses are tissue and species specific viruses that can cause hepatitis and induce formation of primary hepatocellular carcinoma. They replicate their small DNA genomes by reverse transcription via a RNA intermediate, the pregenome. First strand DNA is primed by a protein and second strand DNA by a RNA oligomer which is derived from the terminally redundant portion of pregenome RNA. Prior to initiation of second strand DNA synthesis, this RNA primer is translocated to the second strand DNA priming site. To gain a detailed understanding of the replication scheme of hepadnaviruses, we will analyse specific replicative intermediates, perform a genetic analysis of viral replication and explore the genetic structure and the biochemical properties of the viral polymerase gene and its product(s). Using ground squirrel and woodchuck hepatitis viruses we will investigate the mechanism by which second strand DNA synthesis is initiated, specifically addressing questions of the origin of the RNA primer on pregenome RNA, how the 3' end of the RNA primer is created, and how the RNA primer is translocated to the second strand DNA priming site. To investigate the enzymatic activities encoded by the viral polymerase gene, we will express the ground squirrel hepatitis virus polymerase gene in a bacterial expression system. Specifically we will search for reverse transcriptase and RNaseH activities and identify the location of their enzymatic domains on the polymerase open reading frame. Using in vitro synthesized viral RNA and DNA templates, we will explore the biochemical properties of these activities and complement our in vivo analysis with in vitro studies under chemically defined assay conditions. Chronic hepatitis B virus infection is a major health problem for which presently no cure exists. An improved understanding of the replication scheme of hepadnaviruses is essential for development of specific antiviral therapy. The development of an in vitro system for hepadnavirus replication might be of general use for the development and experimental testing of inhibitors for reverse transcription.